Nigerian payment processing firm Interswitch and international digital payments provider Visa have established a new partnership to advance the digital payments ecosystem across Africa.
Founded in 2002, Interswitch is focused on the digitisation of payments in Nigeria and other African countries and has disrupted the traditional cash-based payments value chain by introducing electronic payments processing and switching services.
Interswitch founder and chief executive Mitchell Elegbe said: “Sub-Saharan Africa is the fastest growing payments market in the world, with growth driven by a young and dynamic population, rapidly evolving consumer behaviour, and an increasing desire for payment solutions that can be accepted across the continent and abroad.
“I am delighted that Interswitch has formed a partnership with Visa, with whom we plan to drive the next phase of transformation in the African payments landscape.”
Visa will acquire a minority equity stake in Interswitch
As part of the agreement, Visa will invest in Interswitch in exchange for a minority equity stake, helping its valuation reach $1bn, and strengthen its position as a fintech business in Africa.
In addition, Visa will join the investors, including Helios Investment Partners, TA Associates and IFC, as shareholder in Interswitch, alongside Interswitch management.
The partnership is expected to create an instant acceptance network across Africa for the benefit of consumers and merchants and offer better connectivity for communities.
FT Partners served as exclusive strategic and financial advisor to Interswitch, for the transaction, which is expected to be completed by the first quarter of 2020, subject to regulatory approvals.
Helios co-founder and managing partner Babatunde Soyoye said: “A strategic investment by Visa, the world’s leader in digital payments, into Interswitch is a substantial endorsement of the Company’s expertise in African payments.
“As an active investor in leading African payments businesses, we see tremendous opportunities to digitise payments across the continent and have worked closely with Interswitch’s management team to build a high quality and scalable platform geared to address some of these opportunities. We look forward to further collaboration with the Company alongside Visa.”
